CHANGES FOR 2022-23

MTD  for 2026/27 

Making Tax Digital for Income Tax (MTD for IT) will be introduced in stages from April 2026. If you are self-employed or a landlord with more than £50,000 in qualifying income, you will need to start preparing to submit quarterly accounts and digital records at least.

Qualifying income is the total gross amount you receive in a tax year before any expenses. Income from employment (PAYE), partnerships, or dividends (including those from your own company) does not count towards this figure.

HMRC will determine your qualifying income based on the self-assessment tax return you submitted for the previous year. For instance, your qualifying income for the 2026–27 tax year will be assessed using your 2024–25 tax return, which must be filed by 31 January 2026. If your qualifying income exceeds £50,000, HMRC will notify you when you need to start using MTD for IT.

Qualifying income also includes your share of income from jointly owned property, certain trusts, VAT-registered businesses, and disguised investment management fees. It does not include business partnership income, transition profits, or qualifying care relief payments.

Initially, MTD for IT will apply only to self-employed individuals and landlords with qualifying income above £50,000. From 6 April 2027, it will extend to those earning between £30,000 and £50,000. From April 2028, sole traders and landlords with more than £20,000 in qualifying income will need to comply. The government is also considering how to include individuals earning under £20,000 at a later date.